On Tuesday we gathered 60 friends from the publishing community — execs from Conde Nast, Viacom, Thompson Reuters, Wenner, NBC, American Media, Time Warner, Getty, Dow Jones, Gannett, the IAB and others — for an afternoon deep-dive into the rising role of image content as publishing moves to digital and mobile platforms. Our first “Imagesphere Summit.” (Official release here.)

Our CFO suspected it was just an excuse to order Luminate-logo’d pillows. But most people, I think, actually came to learn from industry peers how to hone their image strategies. Given that more than a third of the web’s pixels are image content, 70% of social media activity revolves around a photo, and many of these publishers are seeing upwards of 60% of their pageviews coming from photo galleries, there’s an eagerness across the industry to figure out the image opportunity.

Steve Rubel, EVP at Edelman, kicked off the programming. He identified a schism dividing the landscape of digital publishers. On one side the “Continental Content Divide” publishers focus on ‘spreadable media,’ using infographics, lists and slideshows — short, frequent and easy-to-share content nuggets — to fuel success among social-media consumers. On the other side of the divide are practitioners of ‘drillable media,’ where depth, context and rich visual experience are designed to pull readers deeper into the story. At the center of both approaches (represented by the Play Button in his Media Cloverleaf) is content that directly addresses the visual culture. (More at Steve’s site.)

Paul Asel, managing partner at Nokia Growth Partners (and a Luminate board member) shared a global perspective: How mobile and touch screens are accelerating growth of the Imagesphere. Half the photos ever taken by humankind, he told us, were taken in the past 2 years. He also shared a prediction about the future of digital photos: Today if you hand a non-touch screen device to a child, she’ll ask, Is it broken? Soon all of us will ask the same question if we find ourselves starting at a static image.

Bob Lisbonne, Luminate’s CEO, presented a deck entitled “Welcome to the Imagesphere.” He posited a theory of photo evolution, where the Kodak Era has given way to the Imagesphere — a new phase in which technology has streamlined our ability to take, share and interact with photos. Members of Facebook alone upload more than 300 million pictures a day, and our sprawling social graphs mean that we each (on average) have access to nearly 100,000 photos shared by friends. Imagesphere technologies have enabled digital and mobile publishers to use photos in 3 new ways — as repositories of hidden information that can be revealed with the swipe of a mouse; as drivers or richer experiences; and as a new paradigm for navigation. An effective image strategy creates publisher value via more inventory, higher user engagement, and new monetization.

Bob also proposed that we borrow a concept from fighter jets, “heads-up display,” to imagine a richer experience for digital photos. Heads-up displays allow fighter pilots to watch their gauges without looking down at the instrument panel — relevant data appears as an overlay to visual content outside the windscreen. When an image has “stopping power” and sparks reader demand for more information, don’t force them to look down, look elsewhere on the page, or (god forbid) click off your site to get answers elsewhere. Interactive images can mimic the “heads-up display,” providing your readers answers right inside the image experience.

Rafat Ali, founder and former editor-in-chief of PaidContent (now doing the same at Skift), interviewed Steve Carpi, the global director of production Fantasy Interactive. They discussed FI’s partnership with Gannett around the recent re-design of USAToday.com. Touch screens are training media consumers to navigate by way of photos instead of headlines, Steve said, and websites that steal from tablet design will be better positioned for the next wave of mobile and desktop user experience. It’s an approach he called ‘tactile design.’ Rafat provoked an interesting discussion around two questions: One, now that every story is an image, are image galleries dead? Two, with images moving into such a central role in publishing, will important stories will be lost if they don’t have a compelling picture to pull in readers? (An audience member from Getty volunteered to help!)

Advice from Liz Coughlin, former head of the entertainment sites at Yahoo (now at Young Hollywood): You can either attempt to push your readers to content types that you know how to monetize (eg, articles with large IAB units) or you can figure out how to monetize the content they love, which tends to be your photos.

Brandon Whightsel, design director for WSJ Digital, started with a shot of the newspaper in 1889, the year it began publishing. Beyond turning a five-column format into six columns and the introduction of those iconic woodcut images, though, the paper’s look and feel evolved only gradually until 2003 when it introduced color photos. WSJ Digital, however, has evolved at a radically faster pace. A large photo element across the top of the website — the “Assassination Module,” he called it — was once reserved only for very, very big stories. The importance of images on the tablet experience, however, has changed the design rules. Large photos now anchor many digital and tablet stories, assassination no longer required. Whightsel tipped his hat to Rupert Murdoch as an outspoken advocate for the migration to a more visual approach to publishing.

Offir Gutelzon, business development VP at Getty, talked about the potential unleashed by image metadata. Once a publisher knows what’s inside each image, it can automatically deliver photos relevant to every story and can attach ads targeted by image context.

Luminate CTO James Everingham wrapped up the afternoon with a sneak peek at some products Luminate will launch later this fall — support for new content types, upgraded social features, new controls for publishers and users, and some snazzy functionality for tablet users.

Throughout the day there were more questions than the speakers had time to answer. I guess we’ll just have to do another one of these soon.

It’s been a San Francisco icon for more than a decade. It’s graced our skyline through the dot.com boom and bust. And it’s one of the most recognizable pieces of advertising the city has seen in a long time. But the San Francisco Egotist has learned that in two weeks, the Yahoo! billboard will be no longer. Jon Charles, Vice President and General Sales Manager for Clear Channel Outdoor in San Francisco confirmed, “Yes, the Yahoo! board will be available starting in December 2011.”

In his opening remarks FM’s @johnbattelle says mobile strategy is nothing if not paired with local, social and real-time strategies.

A few presentations later my boss, Luminate CEO Bob Lisbonne recommends you better start thinking about your image strategy too. I may be biased (hey, he signs my paychecks) but I think he’s on to something. Some stats he shared: 10% of the pictures ever taken were taken in the past 12 months (by my count this was the most tweeted/RT’d stat of the conference), roughly 40% of the pixel-space on the web is image content, and over in Facebook we’re uploading 70 billion photos a year. Yet images are still “black rectangles of pixels” to the search engines. According to a post on Google’s blog, among the ironies of computer science is:

We can write a computer program to beat the very best human chess players, but we can’t write a program to identify objects in a photo or understand a sentence with anywhere near the precision of even a child.

When you give users the opportunity to interact with images — let the mouse into an image to get relevant content or services — 20% are doing it.

Meanwhile Liz Ross at Mediabrands says the big cultural events, say Mad Men or Glee, are still created by TV. Digital can’t yet create media opportunities at scale.

Yet Old Spice launched its most recent campaign on YouTube. While the campaign’s creative began as a conventional TV spot — using YouTube as the launchpad was a practical decision, says P&G’s Charlie Chappell, since Old Spice couldn’t afford to run it on the Superbowl head-to-head with a rival product from Dove — it evolved into a social media phenonomenon. “I’m on a Horse” was followed by “Response,” where the handsome and funny star of the original spot created messages that directly addressed Twitter influencers and Twitter commoners, delivered via @Replies. The result: Within 3 days, 40 million people had watched various Old Spice videos on YouTube — that’s more people than watched Obama’s victory speech. P&G attributes a 27% boost in Old Spice sales to the campaign.

Before it was over, even Grover got into the act.

According to Vitrue’s Jenny Heinrich, though, digital advertising is still tremendous pain in the butt: The ease of buying TV means that trafficking and administration costs are 2% of the media investment. For digital it’s 26%. And digital isn’t just expensive on the front end, says Shopkick’s Cyriac Roeding, it’s still less efficient for retailers to point a customer to its online store (where conversion to sale ranges from sub 1% to low single digits) than to its physical location (nearly half the people who walk into a clothing or electronics store make a purchase).

Social media, though, is giving brands an opportunity to make friends for life with customers and new prospects, even as consumers are becoming less inclined to tune in to advertising. One of the first 10 accounts followed by a new Twitter user is a brand, says Manilla’s Jessica Insalaco. While nearly 80% Facebook members follow fewer than 10 brands, the fact that hundreds of millions of consumers are inviting brands into their newsfeeds at all is significant. We hate ads, but we’re willing to be friends with brands.

On Yahoo: Former head of sales at Yahoo Wenda Harris Millard says her old company has become obsessed with math (and chasing Google) and has lost touch with the art of the media business. Given that “many CEO candidates view Yahoo as a falling knife” they wouldn’t want to attempt to catch, Battelle asked Millard how they’re going to emerge from their funk. Pshaw, she said. Yahoo still has 680 million users, and plenty of senior execs love a challenge. “Look at me, I went to Martha Stewart when she got convicted.”

Starcom Mediavest Group CEO Laura Desmond talked of the migration of ad dollars from analog to digital media. Two years ago her clients spent 85% of their budgets on traditional outlets, 15% digital. Now digital’s share of investment is twice that.

She also wants to pull the plug on market mix modeling. As audiences began to spend more time with digital media at the expense of traditional, analog content, the modeling tools overlooked the change, which slowed the migration of ad dollars to digital. On winning the Microsoft business: Our companies shared a strategic view that Microsoft must pivot from being a “marketer of ads to a marketer of experiences.”

American Express VP for Business Apps Management Robert Ciccone shared research showing that 44% of small businesses are using social media to acquire new customers. Given how many SMBs depend on local customers, I was surprised that only 2% say they’re using Foursquare.

Tumblr founder David Karp shared his company’s very impressive numbers. Last year the site did 250 million pageviews, now they’re doing that many each day. The marketer case studies didn’t knock my socks off — they’ve got some work to do here.

Founder and CEO of GetJar Ilja Laurs says the app industry will be as large as the entire music industry in 3 years.

Twitter CRO Adam Bain announced that Twitter will launch its self-service ad-buying platform this year. They’re hoping that will grow their roster of advertisers from the 600 they have today to Facebook or Google levels. Sounds like brands are ready and willing:

Blackberry’s had a rough patch in recent years, but VP Brian Wallace shared impressive numbers on their social media performance: They have 15 million fans in Facebook, who are collectively connected to 400 million of Facebook’s 600 million members.

Yahoo’s Chief Product Officer Blake Irving demo’d Livestand. It’s a new model in which publishers need to think like digital marketers, he said.

“Since launching its iAd mobile advertising service on July 1, Apple has been slow to roll it out. Of the 17 launch partners Apple named for iAd, only Unilever PLC and Nissan Co. had iAd campaigns for much of July. Of the remaining 17, Citigroup Inc., Walt Disney Co. and J.C. Penney Co. — which tied its campaign to the back-to-school-season — have since launched iAd campaigns and other companies are planning iAd efforts.”

I dunno. Clearly the iAds approach is ruffling feathers up and down the ranks of the existing advertising military-industrial complex, especially the agencies. Those agency leaders have power to blackball campaigns destined for iAds — right now. But maybe Apple is betting that, by inserting itself deeply in the creative process, it can replace the agencies entirely.

Ads were everywhere, from the front page of the Times of India — Yahoo’s ad was the front page; news started on Page Two that day — to private cement fences in rural towns, like this one for Vodafone in Alleppey in the southern state of Kerala. Made me feel that Times Square isn’t taking full advantage of all its opportunities.

The vast majority of traffic still comes from search engines, but this data suggests that while we use search to find a particular nugget of information, we’re more likely to use social media to discover new sites.